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SIC Insurance Co (XGHA:SIC) Beneish M-Score : 0.00 (As of Jun. 07, 2024)


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What is SIC Insurance Co Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

The historical rank and industry rank for SIC Insurance Co's Beneish M-Score or its related term are showing as below:

During the past 13 years, the highest Beneish M-Score of SIC Insurance Co was 0.00. The lowest was 0.00. And the median was 0.00.


SIC Insurance Co Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of SIC Insurance Co for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 2.2329+0.528 * 1+0.404 * 0.9464+0.892 * 1.3137+0.115 * 1.4967
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8524+4.679 * 0.165096-0.327 * 0.9232
=-0.21

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Dec21) TTM:Last Year (Dec20) TTM:
Total Receivables was GHS151.1 Mil.
Revenue was 87.005 + 46.232 + 37.552 + 44.735 = GHS215.5 Mil.
Gross Profit was 87.005 + 46.232 + 37.552 + 44.735 = GHS215.5 Mil.
Total Current Assets was GHS0.0 Mil.
Total Assets was GHS714.2 Mil.
Property, Plant and Equipment(Net PPE) was GHS147.1 Mil.
Depreciation, Depletion and Amortization(DDA) was GHS9.9 Mil.
Selling, General, & Admin. Expense(SGA) was GHS119.6 Mil.
Total Current Liabilities was GHS0.0 Mil.
Long-Term Debt & Capital Lease Obligation was GHS2.7 Mil.
Net Income was 49.121 + 1.339 + 0.009 + 9.335 = GHS59.8 Mil.
Non Operating Income was -0.006 + 0.947 + 0 + 0.3 = GHS1.2 Mil.
Cash Flow from Operations was -102.772 + 10.341 + 15.489 + 17.6 = GHS-59.3 Mil.
Total Receivables was GHS51.5 Mil.
Revenue was 58.342 + 35.448 + 34.153 + 36.118 = GHS164.1 Mil.
Gross Profit was 58.342 + 35.448 + 34.153 + 36.118 = GHS164.1 Mil.
Total Current Assets was GHS0.0 Mil.
Total Assets was GHS566.9 Mil.
Property, Plant and Equipment(Net PPE) was GHS91.2 Mil.
Depreciation, Depletion and Amortization(DDA) was GHS9.5 Mil.
Selling, General, & Admin. Expense(SGA) was GHS106.8 Mil.
Total Current Liabilities was GHS0.0 Mil.
Long-Term Debt & Capital Lease Obligation was GHS2.3 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total Receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(151.144 / 215.524) / (51.526 / 164.061)
=0.701286 / 0.314066
=2.2329

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(164.061 / 164.061) / (215.524 / 215.524)
=1 / 1
=1

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (0 + 147.056) / 714.161) / (1 - (0 + 91.245) / 566.858)
=0.794086 / 0.839034
=0.9464

4. SGI = Sales Growth Index

Ratio of Revenue in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=215.524 / 164.061
=1.3137

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(9.512 / (9.512 + 91.245)) / (9.9 / (9.9 + 147.056))
=0.094405 / 0.063075
=1.4967

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(119.581 / 215.524) / (106.786 / 164.061)
=0.554838 / 0.650892
=0.8524

7. LVGI = Leverage Index

The ratio of total debt to Total Assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((2.722 + 0) / 714.161) / ((2.34 + 0) / 566.858)
=0.003811 / 0.004128
=0.9232

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(59.804 - 1.241 - -59.342) / 714.161
=0.165096

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

SIC Insurance Co has a M-score of -0.21 signals that the company is likely to be a manipulator.


SIC Insurance Co Beneish M-Score Related Terms

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SIC Insurance Co (XGHA:SIC) Business Description

Traded in Other Exchanges
N/A
Address
28/29 Ring Road East, Nyemitei House, P. O. Box 2363, Osu, Accra, GHA
SIC Insurance Co Ltd is a Ghana-based insurance company. It offers non-life insurance products including Motor insurance, Fire insurance, Marine and aviation insurance; and Accident insurance. Along with its subsidiaries, the company also issues a diversified portfolio of investment services to provide its customers with asset management solutions for their savings and retirement needs as well as undertaking brokerage services and corporate finance. The firm operates in Ghana. The company generates the majority of its revenue from Fire Insurance.